Shopping for Drugs: 2004
Table of Contents
- Executive Summary
- Introduction
- Comparing Prices
- Therapeutic Drug Substitution
- Bulk Buying
- Pill Splitting
- Generic Drug Substitutes
- Switching to Over-the-Counter Drugs
- Weighing the Cost and Benefits of a Drug
- Case Studies: Price Comparisons for Specific Drugs
- Buying Drugs Abroad
- Special Opportunities for Seniors: Medicare Discount Drug Cards
- Financial Assistance to Lower Drug Costs
- Conclusion
- Notes
- Appendix
- About The Author
Generic Drug Substitutes
Another effective way to lower drug bills is to seek generic equivalent medications whenever possible. Although half the drugs sold are generic medications — up from just over 20 percent in 1985 — they are still underutilized. According to the Prime Institute at the University of Minnesota, only 10 of the 50 medications most frequently used by seniors in 2001 were generics; the remaining 40 were brand names. 52 Branded drugs are more expensive. For example, two-thirds of the drugs dispensed by the Veterans Affairs (VA) health system are generic, but they represent only 8 percent of the VA’s prescription costs. In sharp contrast, the one-third of the drugs dispensed by the VA that are branded account for 92 percent of its drug costs. 53
For retail customers, generic drugs are generally priced 20 percent to 80 percent lower than the original branded drug. 54 Thus the average cost for a generic prescription was $14.70 in 2002, compared to $77.02 for branded medications. 55 Only those medications whose patent has expired are available in generic form, however.
“Smart Shopping: Consider generic drugs.”
The number of generic equivalents available will increase over the next few years, as many of the so-called blockbuster drugs lose patent protection and face generic competition. More than 30 of the nation’s 57 largest-selling drugs will lose patent protection by 2008. 56 Some well-known drugs that have either lost patent protection or will do so shortly include Prozac and Zoloft (for depression), Claritin (for allergy relief), Zocor (to lower blood cholesterol) and Prilosec (for ulcers and gastric reflux disease). Generic drug producers claim that the major pharmaceutical firms delay competition (and effectively extend the life of the original patent) through time-consuming legal maneuvers. However, a regulatory change by the Bush administration that became effective in 2003 limits patent holders to one 30-month delay while contesting competition from generic products. 57 Both the Bush administration and Congress are taking additional steps to speed generic drugs to market. 58 Thus consumers will find more opportunities to substitute generics for brand-name medications over the next few years.
